Depending on who you ask, you’ll get a different answer. However, I think that the financial education gap in this country may be a symptom of how many people don’t talk about money. While your money is your business and you aren’t required to share your financial situations or decisions with others, you could be missing out on a wealth of information by being too secretive.
I got a call last week from someone who wants to buy a house. He wanted to share the good news with me that he spoke to a lender who told him if he had $5-6,000 he could get a mortgage. I’m not going to address the fact that he only has about $5-600, because there are more pressing matters at hand. Pressing matters like a mortgage lender offering him a $0 down payment loan which will leave him paying ridiculous PMI. The fact that his credit is terrible after a string of bad financial decisions (2 cars repo’ed, a previous short sale, student loans in default, etc.). The lender’s willingness to push him into a house he can’t afford etc.
The reason why this lender was able to sign him up for this potential disaster is because he chose not to utilize the resources in his circle to help him figure out whether or not this is a good venture. He knows I work in real estate, have a graduate degree, has banking experience and that I am good with finances. He also speaks to both my mother and I regularly as he is a family friend. Nonetheless, he chose to be secretive about his plans until he had set everything in motion.
I think people might have this misconception that their acquaintances “want to know their business.” I’m not advocating for people to start giving out their social security numbers and debit card pins to anyone who sends them annual Christmas cards, but there has to be a balance of finding a few people we can trust to give us sound advice. The reality is, unless you’re really rich, few of your close friends care or are looking to or even have the ability to do harm with information they might have about your financial moves. But because we are taught that it is improper to talk about money, we don’t share knowledge, resources and compare information.
Personal finance has become a dirty topic and mostly a pretense. Everyone is content projecting unrealistic images of their financial situation. The would rather talk to a stranger whose financial interests conflict with their own well-being because they never have to see that person again. Discussing money matters becomes more about keeping up appearance than making good decision. That is why people carry expensive purses containing maxed out credit cards and drive expensive cars that will be repossessed soon.